Extra Eyes, Ambassadors Everywhere

Please excuse Denver-area builder John Osborn if he doesn’t see the unbridled pursuit of customer satisfaction as something new.

Bill Lurz, Senior Editor and Paul Cardis, NRS Corp.

September 01, 2002

(From left) Village Homes CEO John Osborn, vice president of home building Cheryl Schuette, ambassador Carol Hadd and warranty director Philip Eidenschink have home buyers encased in a web of intricate customer-care programs. But the firm's most effective tool might be extra inspections to ensure that houses close defect-free.

Please excuse Denver builder John Osborn if he doesn't see the unbridled pursuit of customer satisfaction as something new. He thinks it's more like the Holy Grail -- really old, but also really valuable. And something he's been working toward for a long time. He's pretty good at it, too, as a referral rate above 30% indicates. It's just that much of what Village Homes of Colorado does to coddle customers has been in place for a while.

After notching a combined score of 173.41 in this year's National Homeowner Satisfaction award competition, Osborn may be slightly miffed that Village came in second in the over 500 closings a year category, but he's still got that referral rate to take the edge off his anger. And the secret to his success may as simple as a few extra pairs of eyes in the home inspection process.

"The people in sales and warranty are pretty good with customers in a lot of companies," Osborn says. "Where we have a challenge is in the middle of the customer relationship, on the construction site. A lot of people there are not skilled in relating to people, and not especially receptive to training. We used to be able to shield those people by keeping buyers away from the job-site, but that won't work anymore."

Company Profile

NHS combined score:

173.4167

Surveyed buyers:

541 closings

Headquarters:

Littleton, Colo.

Employees:

240

Locations:

14, 5 with multiple product lines

Principal:

John Osborn

Product:

Townhouses and detached homes from 1,400 to 3,600 square feet, priced at $230,000 to $450,000

2001 revenue:

$174.2 million

Big news:

Third-party inspectors, quality assurance representatives and even the regional manager walk homes before buyers' new home orientation.

Referral sales rate:

32%

In production building, Osborn reasons, many supers get caught up in the frenzy of rapid-fire closings and lose sight of the fact that pleasing customers -- one at a time -- is the real engine that drives profitability.

"What took us to a whole new plateau of customer satisfaction was a very simple idea," Osborn says, "just forcing supers to have the discipline to complete a house before closing it.

"We stopped allowing anyone to transfer incomplete houses to warranty," vp of home building Cheryl Schuette says. "Today, if a super doesn't finish before closing, he has to complete the work himself with the people living in the house. After they do that a few times, it doesn't happen nearly as often as before."

Village also bonuses supers for on-time, defect-free closings, which doesn't hurt.

To help the supers reach closing with a house that will pass muster with buyers, Village now adds several additional pairs of eyes to the inspection process. "We have a third-party inspector from an engineering firm preview every house sometime during construction," Village ambassador Carol Hadd reports. "We've also built an extra week into our closing process to allow time for punch-list items to be corrected, and we have our quality assurance rep walk the home a week before the buyer's final walk, the new home orientation. Then the regional manager also walks each home the day before orientation. If any items do show up at orientation, there's still a week to correct them before closing."

The Village ambassador is a position designed to take over as chief hand-holder from the sales agent at closing. She's usually the person buyers call first when they have a question or even a warranty item. "Our job is to know how to proceed with anything that comes up," Hadd says. "It's all part of our 'Village Touch,' a unique collection of services that also includes the warranty response team.

If It Ain't Broke, Don't Fix It

Village used to do 30-day and 11-month proactive warranty walks of the home, but has given that up in favor of responding to calls for service as needed. "We found that people felt we were pressuring them to find something wrong," warranty director Philip Eidenschink says. "The homeowners seem to like it better this way."

Village has many familiar customer care processes in place. Sales agent and super meet with buyers for a pre-construction orientation, then to walk the house at pre-drywall stage. Sales agents call customers every week; supers every two weeks. Those sales calls take place every week, even if the customer visits the site every day. The payoff is often referral business.

Like every other NHS winner, Village has single-minded focus on having a smiling face or a friendly voice right there whenever customers need help or want advice.